He questioned the merit of negative interest rates and pointed to a lack of demand to borrow money, when asked if the central bank considering further subsidising bank lending by adjusting its $135 billion Term Funding Facility bank funding program.
While the Reserve Bank's actions have been highly effective in stabilising bond markets and lowering borrowing costs, other central banks have taken more extreme measures- such as purchasing corporate bonds, expanding bond purchase programs and exploring negative interest rates.
The Reserve Bank's deputy governor said liquidators are preparing for a delayed but inevitable rise in business failures in the coming months while uncertain businesses are reluctant to take advantage of historically low interest rates.
The unprecedented expansion of the central bank's balance sheet will not lead to an outbreak of inflation, Reserve Bank deputy governor Guy Debelle has asserted on Tuesday.
The Reserve Bank's bond purchasing program has aimed to pin the three-year yield near 0.25 per cent, and the market credibility of the target has allowed the central bank to pare back purchases of late.
Economists and traders have tracked the increase in Exchange Settlement Balances to anticipate the actual cash rate in money markets, which has fallen to 0.13 to 0.14 percent, below the Reserve Bank's official target rate of 0.25 per cent.
The unprecedented expansion of the central bank's balance sheet will not lead to an out-break of inflation, Reserve Bank deputy governor Guy Debelle has asserted on Tuesday.